200,000 SMEs spared by new e-invoicing threshold, says association

Samenta says this gives the firms some breathing space to gradually move towards digital systems for their finances and accounting.

Samenta said many of the SMEs with annual revenue under RM1 million operate with slim margins and without the digital infrastructure needed to implement e-invoicing immediately.

PETALING JAYA:

 About 200,000 more small and medium-sized enterprises (SMEs) will be exempted from mandatory e-invoicing thanks to the higher annual revenue threshold of RM1 million, says a trade group.

The Small and Medium Enterprises Association of Malaysia (Samenta) welcomed the government’s decision, which it described as timely and compassionate amid the pressures being faced by SMEs.

Samenta president William Ng said many of these 200,000 SMEs operate with slim margins and without the digital infrastructure needed to implement e-invoicing immediately.

“For these businesses, the announcement offers much-needed breathing space at a time when they are already grappling with rising costs, tariff uncertainties, growing competition from foreign online sellers, and other unforeseen compliance burdens.

“This decision will allow the smallest enterprises in Malaysia to focus on stabilising their operations, improving productivity, and upgrading their internal processes without the fear of abrupt disruption.

“It also preserves the broader national digitalisation agenda by ensuring that adoption happens at a pace that is practical, sustainable, and sensitive to the realities on the ground,” he said in a statement.

Nonetheless, Ng reminded SMEs that this did not mean they should delay automation and digitalisation.

He said owners must use this extra breathing space to bolster their accounting practices and financial records, while gradually moving to digital systems.

“Samenta thanks the prime minister and the finance ministry for listening closely to the concerns of the SME community and for taking a balanced approach that safeguards both economic resilience and long-term national progress,” he said.

Yesterday, Prime Minister Anwar Ibrahim announced that the Cabinet had decided to exempt businesses with annual revenue under RM1 million from mandatory e-invoicing, which comes into effect on Jan 1.

In June, the Inland Revenue Board said the finance ministry decided to defer the implementation of e-invoicing for companies earning between RM1 million and RM5 million to Jan 1, 2026 from July 1, 2025, previously.

Implementation for companies with annual revenue of up to RM1 million, now scrapped, was to have been deferred to July 1, 2026. - FMT